The 2016 Economy: Our “Slow, Steady Ride” R. Christopher Jones, Ph.D.

What has the last year offered us (the United States)? An economy that continues to move forward, but slowly.. Recession technically over June 2009 24 out of 27 quarters with positive real GDP growth since Q3 2009 Q4 2015 Real GDP growth of 1.4% (annualized) Unemployment at 5% Retail sales showing signs of slowdown Modest slowing of industrial production and capacity utilization Interest rates still low, and we have avoided inflation S&P 500 net growth is flat/negative YTD (2012.66–2082.78)

What else did it bring? Improved job creation U.S. created 2.81 million over the past 12 months U.S. economic expansion has been substantially aided by drop in global oil prices Less European demand, increased domestic supply from fracking More disposable income and cheaper product transport costs have resulted in increases in consumption and investment

What about Florida? Growth has returned (and increased) 12-month net job growth – 253,500 Unemployment at 4.7% (Feb.) 106,559 housing starts over the previous 12 months Home values moving upward All major regional markets seem to have awakened from the economic coma, and are showing signs of better health

U.S. Real GDP 1953-2015 (Chained 2009 Dollars)

U.S. Real GDP Annualized % Growth 1953-2015 6 6

U.S. Unemployment Rate 1962-2016 7 7

U.S. Housing Starts (SAAR) 1962-2016 8 8

Real Retail & Food Svcs. Sales 1993-2016

Inflation Rate (Annualized, by Month) 1972-2016

Real Per Capita Disposable Personal Income 1961-2015

Credit Market Debt Per Capita 1961-2015 (infl. adj.)

Consumer Sentiment 1981-2016

Federal Debt 1973-2015

2016 U.S. Forecast Growth continues, real GDP will grow by 2.8% to 3.0% Job growth continues, unemployment finishes out the year around 4.5% - 4.7% Stock markets grow by 6% - 8% Inflation concerns still can’t be ignored, nor can the international debt crisis The “political cycle” may heavily influence investment

Florida: The Facts Florida has added 1.21 million jobs since July 2010 Represents 9.2 percent of all U.S. jobs created during this period Florida’s net job gains since 7/10 now exceed the job losses experienced during the recession (930,800) Previous Year: Gained 253,500 jobs 4.7% unemployment (Feb. 2016) 106,559 housing starts in the previous 12 months, compared to 86,423 and 89,032 in the 2 prior years Home prices have increased by nearly 10 percent in the past year

Florida Real GDP (millions of chained 2009 dollars) 1997-2015 17 17

Florida Employment (000s) 1991-2016 18 18

Florida Unemployment Rate 1984-2016

Florida Housing Starts 1989-2016

Florida Home Price Index (Q1 1980 = 100) 1989-2015 21 21

Leading Index for Florida 1992-2016 22 22 22 22

FL Employment By Region 1992-2016 (000s) 23 23

FL Unemployment Rate by Region 1992-2016 24 24

FL Housing Starts By Region 1992-2016 25 25

Polk County Population: 633,052 Employment: 265,842 Unemployment Rate: 5.3% 12 mo. Housing Starts: 2,798 5-Year Forecasts: Population Growth – 38,440 Employment Growth – 22,740

What’s in Store for Florida? More job growth, lower unemployment Growth is accelerating relative to recent years We are witnessing the first post-recession “surge” Are we ever going to see a full recovery of the housing sector? Depends on how you define “full recovery” If you use 2000’s criteria, no – but it is moving All areas are moving forward again, at a healthy pace SE Florida will create the most jobs (most diverse economy) 27 27